With SSD Prices Falling, Is Now the Time to Buy?

Are you looking to buy a new storage drive? With prices sliding some on solid state drives (SSDs) while hard disk drives (HDDs) grow increasingly expensive, this could be the time to consider investing in an SSD if you haven’t done so already.

On the other hand, maybe you should hold off for a while. Although recent price rises have reportedly amounted to 4 to 5 percent on 500GB models, that isn’t such a huge surge.

Higher-priced HDDs could be just a temporary phenomenon, too. Some blame the price hikes on recent moves by manufacturers like Seagate, Western Digital, Toshiba and Hitachi to cut their production levels on HDDs for the final quarter of 2010.

Meanwhile, manufacturers like Intel, Kingston, and Adata Technology are reducing their pricetags on SSDs by as much as 10 to 15 percent, according to an account in DigiTimes. SSD deals might get even better in the future.

SSD prices varyThe trend toward bargain pricing on SSDs is hardly universal, though. In an extreme example, just this month, LSI announced the WarpSpeed, a very high-end SSD boasting a throughput rate of 1,400 MB/s. The WarpSpeed starts at $11,500, although most SSDs don’t come near to that level.

Still, Intel is indeed dropping its pricetags on SSDs, confirmed Deborah Paquin, an Intel rep, during a recent Pepcom event in New York City, where she gave side-by-side demos of apps running on SSDs vs. HDDs to illustrate the advantages of SSDs.

Benefits of SSDs, include faster performance, better display of graphics and video, greater reliability, and reduced heat and noise, according to Paquin.

Kingston, too, has been cutting its prices, said Kingston’s David Leong, who talked up Kingston’s SSDs – some but not all of which are rebranded editions of Intel’s drives – at the same show.

Why the reductions?Leong told me that prices on existing storage drives are bound to fall when newer models become available and sellers need to clear out their inventories.

However, prices on Kingston’s new SSDs are also declining, a tendency that Leong attributed to increasing small die sizes in nano manufacturing processes. Lower die sizes help manufacturers to bring prices down by reducing the cost of materials, he reasoned.

Others suggest, though, that storage makers are lowering their SSD pricing on new drives intentionally, just to spur more sales.

In an August research report, analyst firm iSuppli recommended that manufacturers reduce the price premium of SSDs over HDDs to 40 percent so as to help SSDs become more competitive with HDDs.

Although prices on some manufacturers’ SSDs have already dipped since then, iSuppli continued to beat the drum in this direction in a report issued last week.

“A type of storage device that has no moving parts but features only electromagnetic solid state memory, SSDs are considered to provide better performance than HDDs with their spinning, moveable heads. Nonetheless, SSD pricing remains at a premium, limiting adoption of the technology in the PC area to the low single digits,” said Fang Zhang, an iSuppli analyst.

“In [one] illustration of the price delta between the two storage technologies, the OEM cost of a 258GB notebook SSD in October was $395. In comparison, a 320GB notebook hard disk drive during the same month could be obtained at an OEM price of $47.”

Yet Zhang also predicted that new SSD-driven Apple computers could pose a “formidable challenge” to traditional PCs, because of the Apple products’ “competitive price points, attractive form factors, and faster NAND-enabled performance.”